Building sound relationships from scratch

The car stops. Within seconds you’re opening the vehicle’s passenger door and eyeing the driver.

A short conversation ensues concerning the direction and destination of both parties. But in truth the verbal exchange simply masks the more important stuff, because the decision to accept a lift is never a small one. You’re checking out the driver’s appearance and the state of the vehicle; you listen to tone; smell the air. And if they’ve got company, there’s many more judgements to make.

Rugby legend

Sometimes the decision is easy and delightful. For example, whilst hitching north of Aberystwyth I opened the door of a large gleaming Mercedes only to set eyes on a world rugby legend sitting at the wheel. Then there’s the bizarre, like the time I slung back a minibus door to be greeted by a group of singing builders (with an unusual passion for scaffolding) . And of course, the real challenges; when your sixth sense (which is developed through experience) suggests something isn’t right.

And that ‘dynamic’ of meeting new people is the same in business. Entrepreneurs cannot wait for people to come to them. This necessarily means going out to see people and finding yourself in unfamiliar territory and different situations. This stretches the comfort zone and initially puts you out of control, but with practice and experience patterns of behaviour emerge and confidence grows.

It’s accepted that people are typically far less relaxed when they meet others for the first time. These first few critical seconds and minutes can be awkward. But just like the hitchhiker, the entrepreneur has a vested interest in developing their judgement skills, using time efficiently and being liked by people they meet. So get on with it!

Judgement Skills

First opinions about people are typically formed within 7 seconds.  As a hitchhiker I rarely spent much time talking about directions before getting in the vehicle. And I reckon I can count on one hand the lift offers I actually rejected. And these ratios reflect almost exactly my first-time meetings with people in business. Within 10 seconds I’ve decided the person in front of me isn’t a complete lunatic and it’s likely that the time will be well spent.

As with the hitchhiker, it’s important not to just listen to what people say when you first meet them. If you’re in their office what does the rest of the room tell you about them? How well do they dress? How much interest do they really take in you? How do they behave towards others who may be around? Answers to these questions provide clues about the person/people with whom you are dealing and you are able to adjust your own behaviour accordingly. You’ll find many other articles within this Blog that focus on the issue of Human Behaviour.

Getting people to like you

My unexpected meeting with Welsh rugby legend Gareth Edwards (and scorer of the greatest try in rugby history) will live with me forever. But  throughout that memorable journey winding through the valleys, I enjoyed listening to arguably the most talented Welsh rugby player ever to have lived, his take on that famous Barbarians try, how his career started and of course why he picked me up. As such, Gareth did most of the talking and I just listened. This simple dynamic works in a very powerful way and builds relationships because it is based on the following principle:

…the most important person in our own world is ourselves and given the opportunity we typically ‘like’ to talk about ourselves. 

Within the pages of the must read book ‘Influence: Science & Practice‘, author Robert Cialdini devotes a whole chapter to the issue of ‘Liking’. Critically, we like people who take a genuine interest in us and the easiest way to demonstrate this is to ask questions and listen to what people say.

The entrepreneur who bothers to take a genuine interest in prospects, customers, suppliers and staff makes people feel good about themselves and thus builds stronger relationships. By contrast, the person who talks endlessly about themselves falls into a common trap. They bore quickly and struggle to build quality relationships.

As a hitchhiker it was always my way to encourage the driver to talk about themselves. Not only was it interesting to learn about their lives, but they typically drove me further (Gareth very kindly went an extra 20 miles).

However, people are different and some are cautious about revealing information. When I hitched some didn’t want to talk at all. But by tuning into situations it was possible to adopt appropriate strategies that reflected the needs of the individual with whom I travelled.

Key Learning Points: Regularly meeting new people makes you a better judge of others and situations. Actively seek non-verbal and verbal clues to help you assess others and create a positive influence by asking questions and listening to the answers.

Bootstrapping: My way on the business highway

BootstrappingshoesFailure has a wonderful capacity to reveal opportunities that otherwise remain hidden.

Disastrous ‘A’ Level results in 1984  forced me to take a gap year. Whilst I envied friends destined for university, part of me delighted in the chance to step off the education treadmill.

Suddenly I was making choices, dealing with consequences and relying less on others. I quickly found a job (earning a pittance) in a Cumbrian hotel and subsequently worked at a field centre, school and finally an office. And hitchhiking became a way of life. Yes it made travel between places and jobs affordable but I realise now how it chimed perfectly with my new independent lifestyle.

And if like me, you thrive on responsibility and enjoy control over your own destiny, you are probably far more likely to want to start a business one day without being financially dependant on others. In other words, you’ll probably want to ‘bootstrap’ your business.

I left university in June 1989 with a degree and a four figure overdraft. But by working every hour (as a security guard of all things) at events such as Wimbledon and Ascot I managed to get myself back in credit and even put some money aside for starting my first venture that autumn.

Bootstrapping

As a result, I was able to ‘bootstrap’ my business and I didn’t have to go ‘cap in hand’ to the banks. It certainly never crossed my mind to go down the investment/angel route probably because their services were far less prominent 20 years ago. As an aside, I am somewhat sceptical about the amount of money and effort universities in-particular put into ‘high growth’ support services – I believe this issue is more driven by available public funding rather than real  business demand, which is completely the wrong way round.

By bootstrapping the first business I was also able to start as a sole trader. This meant I wasn’t subject to complex and potentially expensive partnership or Limited Company agreements and my tax situation was much more straightforward too. And of course, being a sole trader meant my finances were kept completely private unlike – limited companies that must submit their accounts every year for public scrutiny at Companies House.

As a bonus, this also meant there was no one telling me I had to write the dreaded ‘plan’. This lean approach to start-up has been researched and written about by academics, among them Colin Jones from Tasmania who has posted relevant materials on the following useful website: http://www.teaching-entrepreneurship.com/lean-startups.html

Bootstrapping like hitchhiking keeps things simple and you just have to rely on yourself. You get out what you put in but of course when things go awry there’s only you to sort them out.

This might sound scary but the highs in almost every business case I’ve ever known outstrip the lows. And importantly, as you travel along this route so your horizons for what is possible in your life expand almost exponentially.

But whilst going solo has real merit, it won’t take long before you’re having to work with other people. Whether you work with external partners or hire staff, opportunities to grow your business will present themselves and it quickly becomes impossible to do everything yourself.

Key Learning Points: Bootstrapping a business gives you complete control and means you are not answerable to any external funder/investor. This simplest of routes not only makes life easier but it also means you benefit from everything you put into your work.

Getting a lift with good branding

‘Unsafe’, ‘risky’, ‘dangerous’, ‘uncommon’ and ‘unadvisable’ were some of the words that people used to describe hitchhiking in a recent straw poll I conducted.

Okay, it wasn’t scientific research. Nevertheless, I’m fairly sure these negative feelings (or brand perceptions in business speak) are relatively commonplace. Whether it’s justified or not, hitchhiking in the UK has got itself a bad name and it’s perhaps no surprise to see far fewer people on the roads now compared to 20 years ago.

What can budding entrepreneurs learn from hitchhiking’s misfortune?

Brands are like personalities. A key driver of human behaviour is the need to be liked by others; so we shape how we look and come across accordingly. The same principles apply when branding a business.

So the first tip is not to fall into the trap of the ‘me first’ process when creating a brand. It’s too easy to create a name, choose colours, fonts and materials etc. that are based solely around what you as the business owner likes. You need to take into consideration how the target audience will respond and feel.

If you think about and consult your potential customers when considering and developing a brand, your product or service offering is far more likely to appeal to prospective buyers.

More haste less speed

The second lesson is not to rush the process. The brand identity is your eternal shop window; and if the detail is not thought through at the beginning it will look wrong, date quickly and adversely affect trade. The only solution will then be to re-brand and in effect start again which of course costs money and time.

Finally, some people confuse brands with logos. Whilst the creation of a logo typically needs careful thought and attention, it is only a visual representation of your overall brand and thus a small part of the whole branding exercise.

For more information on brand principles take a look at Branding Strategy Insider and Brand Identity Essentials. You are bound to find some great ideas that will help you to build your business brand.

Developing a brand that performs

As mentioned at the start of this article, the two words ‘Hitch’ ‘Hiking’ when used together evoke strong feelings in peoples’ minds. Unfortunately they tend to be negative feelings. Only two days ago a friend said he thought I was crazy when I suggested I’d hitchhike again later this year; there is no evidence to show hitching has become a more dangerous method of travelling. It is all perception, but perception is everything.

So when creating a brand, you are creating a personality for your business. You will naturally want people to react in a positive way to it. For example, if you are developing a hi-tech business you will probably want your brand to evoke the following feelings: cutting edge; reliable; professional; dynamic etc.

Alternatively, if you are looking to start a courier company you will probably want your brand to convey: reliability; speed; no hassle; ease of use etc. And all of this has to be wrapped up in the name, design, use of colours, strap-line, materials; in-fact everything that is customer facing and thus communicates the brand values.

Getting the message absolutely right takes time and money; so there is a good argument for keeping things as simple as possible to start, rather than worrying about too much detail. As your business progresses so the brand can be developed and enhanced in line with feedback and your personal aspirations.

Consistency

Finally, the brands that perform best are ruthlessly consistent – that word again. Think of people’s personalities that you really like and you realise that you enjoy their company because you know where you stand with them – they are completely consistent; unlike people whose behaviour is erratic, leaving you and others on eggshells or at a distance.

Throughout my hitchhiking ‘career’ the brand personality I conveyed at the roadside remained consistent. I always wanted people to see me as a non-threatening, easygoing individual who was travelling with a purpose.  Given the chance, I would always look at the driver and if eye contact was gained (regardless of the Anglo Saxon expressions and gestures I occasionally received) I would smile.

It worked for me and when I go hitching later this year all those principles will be applied again. I look forward to thumbing lifts and travelling far this year…

Key Learning Points: Treat your business brand as a personality and shape it so that prospects and customers see you in a positive light. Being ruthlessly consistent with the brand means your customers won’t be confused about what you do and offer.

The Importance of being focused

From an early point in my self employment journey I regularly used the following four questions to help look forward in business and focus on what I wanted to do:

  • Where have I come from?
  • Where am I now?
  • Where do I want to go?
  • How do I get there?

Of course, the question structure isn’t rocket science and makes regular appearances in good strategic planning books; but it appealed to me because of its simplicity and link to everyday life. For the journeying hitchhiker of course these four questions are easy to translate. For example: I’ve come from Bristol; I’m at junction 2 of the M42; I want to go to Coventry; I’m going to hitch at least one more lift to get there today.

Business exercise

If you consider the 4 bullet points for own business (or business idea) you shouldn’t find it too difficult to answer the first two questions. Be brief (one side of A4 max), stick to key facts and focus on issues to do with: yourself, finance, customers, resources (including staff if you have them), sales and of course your own product/service.

Answering the third question however is typically more demanding. But importantly, the thinking process will help illustrate and define the true focus of your business. If you can write down in no more than 5 minutes precisely where your business is going and remain very confident about the answer, then you have focus.

However, if the question about where you are going ties you in knots, elicits different responses or leaves you without an answer, then the chances are that the direction of your business is in need of attention.

No direction? Danger…

Market and competitor research helps define clear target markets for businesses to aim at. However, a business that is unable to define its customer base (insufficient research) has little or no focus; as a consequence everyone is seen as a potential customer. And then this happens: Sales and marketing activity is based on guesswork and uninformed, generic promotional messages are written which hope to appeal to anyone who might see them.

This unscientific yet frighteningly common approach is not only highly inefficient, it also drives businesses to the wall.

And it’s easy to see the parallel with hitchhiking. The hitcher who accepts a lift with any passing vehicle, without first checking where the driver is going (research), ends up in trouble. Without focused direction there is little chance of reaching the destination on time if at all.

Being focused on a clear direction also helps to ensure that business strategies and processes are kept ‘simple’ and ‘consistent’,  two very important principles I will write about again.

Asda Walmart for example, has a very simple and consistent message of ‘lowest price’ and this mantra is known right throughout the organisation – and it means thousands of people who work there know always to focus on low cost and efficiency.

Finally, once you know where you are going, you have to work out how you are going to reach your goal. There may be many route options although practical stuff like your budget and time-scales will limit choice. But like the hitchhiker who is standing by the road for the very first time, you must not be daunted by the prospect of making decisions and thus mistakes – it’s inevitable. So decide how you are going to reach your goal and then go. You are at least guaranteed to learn much on the way.

Key Learning Points: Knowing the markets you want to serve should define the direction of your business. Use the 4 point plan to keep sales and marketing work focused and consistent; this way you are far more likely to reap returns.

Why knowing your competitors gives you the advantage

Watford Gap Service Station on the M1 is the only place where I have encountered real competition for a lift. Hitchhiking north from London one sunny Sunday afternoon, I was dropped off at the services only to find myself staring at a long queue of hitchhikers all desperate to travel my way. Buggar!

Fortunately I formed a quick plan to get around the problem. This idea was entirely based on knowing how my fellow travellers and drivers behaved. I just had to be different in order to get moving again.

And it’s the same in business. If you want to stand out from the crowd you have to know how the crowd behaves, so that you can be seen and chosen by customers.

Competitor research

Through observation, primary/secondary research, mystery shopping, in fact whatever legal information gathering approach works for you, you need to know what your competitors are doing. You need to know their prices, how they promote themselves, what makes their product/service special and more. You then can use this information alongside your market research to make informed decisions and thus position your product/service so that it has the greatest chance of being sold. The Stalker’s Guide to Competitive Research available on the Blueglass Blog offers a lot of practical ideas on this subject.

But for many businesses, understanding their true competitive situation is not necessarily as straightforward as observing the Watford Gap queue. Take Tourism attractions as an example; it’s not just other attractions they need to monitor. Tourism attractions are competing for peoples’ time and as such there is a lot of indirect competitor activity to consider. For more helpful theory see Michael Porter’s Five forces of Competitive Position Model or use the library of websites and articles collected by Cayenne Consulting which are all designed to help startups complete competitor research.

If you don’t think deeply enough about your competitive position you risk living with a false sense of security. People who believe they don’t have any competitors because their ‘product/service is unique’ are only kidding themselves and risk a painful fall much later.

Thinking differently

When I first saw the Watford Gap queue my heart sank because the reality of my situation was so stark. Yet these moments are defining. Starting and running a business is akin to walking into a meteorite storm – but you can’t just give up because you don’t like what’s being thrown at you. Invariably the solution to the problem being faced is closer than you think – you just have to assess your competitive position, think differently and if necessary be brave.

From all my market and competitor research I knew that hitch hiker queues were uncommon. I also knew that if a vehicle was going to pull over, the driver wanted time to judge the hiker and the relative safety of the situation. As a consequence, I reasoned that the best place to stand to get a lift was at the back of the queue, plus about 10 metres. Get on the edge and stand out from the crowd*.

Apologies if you were in that queue back in 1986; I was picked up within 5 minutes. Two guys in a car with canoes on the roof-rack screeched to a halt and shouted at me to get in quickly. They read the situation too. Looking in his mirror the driver could see several other peeved hitch hikers making for his car. But within 30 seconds we were gone. In the next five minutes I was moving again thanks to some basic analysis and preparedness to be different and work the situation to my advantage.

And that’s my last point in this post. So many businesses in every industry conform to unwritten rules and thus behave just like their competitors. As a result they camouflage themselves and make it difficult for people to make an informed choice. It’s only when a new player comes along, behaves differently and takes a chunk of the market that they sit up and take note – and sometimes it’s too late.

Key Learning Points: No product or service is unique and to stand out in any market you must know who you are up against. Innovate and be different so that potential customers not only know where to find you but also beat a path to your door.

 

*Not sure who first said this, but I heard the cricket commentator Phil Tuffnell quote it on the  radio. It’s very true. “If you’re not on the edge, you’re taking up space.” 

How market focused businesses go further faster

What is the best question to ask in market research?

When starting up far too many businesses don’t ask any meaningful questions at all. Instead they focus on the product or service they offer rather than the market being served. Research is considered a distraction rather than the guiding light to doing good business – and it’s a key reason why so many businesses fail early on.

If you want more evidence on this subject just watch ‘Dragon’s Den’ and see how many ‘failed’ presenters know their product inside out but their market knowledge is guesswork at best.

Market research has to be right up there in the Hitchhiker’s Guide. If you don’t observe, note and understand the ‘rules of the road’ you won’t travel very far. And as a rule of thumbing (sorry), once I was in the vehicle I would typically start an early conversation by seeking to better understand why drivers chose to offer me a lift. And that’s the best question in market research: “Why?”

The question ‘why?’ naturally seeks deeper reasoning and thinking. Asked in the right tone, the respondent is invited to provide invaluable detail. And the resulting information allows you to learn about and ultimately make subtle but absolutely critical changes to aspects of your product or service. Basic market research (what? when? how? etc.) should highlight demand levels but if your offer doesn’t ‘unpack’ in just the right way to customers, then sales can be hugely affected.

Find out what people want & provide it

Hitching taught me very quickly that a large rucksack spoke volumes to passing drivers. A rucksack, I was told, was non threatening; it suggested I was travelling with a purpose; and people warmed to the idea that they were helping someone who they believed had been living in the great outdoors. On this note of behavioural understanding, I recommend you check out ‘semiotics’ because this fascinating subject is going to be a fast developing field of study over the next few years.

People also commented on the merit of where I should stand on the roadside – it was important to them that they had time to see me, make a judgement and pull over with relative safety. My appearance was also an issue to (I was never scruffy nor overdressed) but people were divided over whether I should be using a sign or just my thumb (more about this when I write about promotion).

Fortune favours the brave (and wise)

Observing peoples’ behaviour and using research to modify my roadside ‘offer’ never stopped. A journey that started in Fort William and ended in York (1988) demonstrates the benefit of knowing what people want.

I knew it was a long-shot covering the 350+ miles in a day so I needed to stack the odds as best I could. Research showed there was no ‘driver-friendly’ place to hitch from (on the road out of Fort William) and so I arranged for a friend to drive me a few miles into Glen Coe, where I was dropped off at a roadside lay-by with a great view back down the road.

There was very little traffic in the Glen that day. But the clarity of the air meant I saw every vehicle long before I heard it. After 25 minutes only 3 vehicles had passed by. Then a wagon became visible in the distance and it slowly made its way up the valley towards me. Stood at the end of the lay-by I put my thumb out so the driver had a good view of me for at least 200 yards. At the last minute, the air brakes went on and I knew I was in luck.

Better still, when I climbed the cab stairs and opened the door to tell him I was headed to York, his smile widened. With a friendly Yorkshire accent, he let me know it was my lucky day – he was off to Doncaster! Full of enthusiasm I got in the cab and it wasn’t long before I asked him the ‘why?’ question. He told me that he liked to pick up hitchhikers for the company, but if I had been stood anywhere else in the Glen he probably wouldn’t have seen me or been able to stop safely. My day could have been completely different.

And these and many other questions were asked every time I hitched – just as much as market research should be a continuous exercise with potential and existing customers. Like my travels, it doesn’t mean you have to devise formal questionnaires or organise expensive focus groups – so much gold-dust can be extracted by asking critical but simple questions of the right people at the right time.

But knowing the market is one thing; you must know your competitors too.

Key Learning Points: Focus on the market so that products or services you develop are demand led. Use the ‘why’ question to really understand what motivates your customers and drives them to make decisions that affect your business.